Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: articles on VAT and GST in India :: TAX RATES - GOODS TAXABLE @ 4% :: list of goods taxed at 4% :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: cpt :: VAT Audit :: TDS :: VAT RATES :: Central Excise rule to resale the machines to a new company :: due date for vat payment :: ACCOUNTING STANDARD :: empanelment :: form 3cd :: ACCOUNTING STANDARDS
General »
 Number of companies paying tax over Rs 100 crore declines in 2013-14
 Tax and the dilemma of the self-employed
 Banks warn share tax hike threatens Paris' post-Brexit appeal
 PMC may decide on property tax rebate for IT firms this week
 I-T Dept is giving out certificates of appreciation. Have you received yours?
 Government works on ironing out benefits refund mechanism for exportersa
  Tax officials are using an IDS provision to question transactions beyond six-year-limit
 Tax-free bonds rally like midcap funds
 Senior citizens do not have to pay advance tax on salary and interest income
 GST: Audit commissioners to get adjudication powers
 Interest on NRE rupee account can be exempt from tax under FEMA

Fall in remittances may hit consumer spending, tax targets
June, 21st 2016

It is time economic planners in Kerala reflect on the serious impact of sharp fall in remittances on future consumer spending and tax collection in the State. Being the biggest receiver of remittances (40 per cent) among States, Kerala has traditionally had the highest consumer spending.

Studies have estimated that the actual collection from commodity taxes is 30 per cent less than potential, resulting in high revenue deficits. In this context, recent sharp fall in remittances can have an adverse impact on future consumer spending and tax potential.

Lower share
Already, laxity in own tax effort has resulted in Kerala having a revenue deficit at 2.44 per cent of GSDP when all States average was 0.4 per cent during 2013-14. The higher per capita income has meant that Kerala gets a lower tax share from the Finance Commission awards.

These make it imperative for it to find innovative methods to stimulate economic growth by tapping non-budgetary sources and thus expanding the resource potential. Though there could be a case for expenditure efficiency, fiscal correction for Kerala cannot be solely expenditure-led, says R Mohan, researcher and fiscal analyst.

Development expenditure
Cutting down on development expenditure is not – neither it should be – the way to achieve it, Mohan adds. But RBI statistics point to how States have violated this paradigm in their frantic attempts to control revenue expenditure.

For 2013-14, the latest year for which actual figures are available, slashing of expenditure and failure to mobilise Own Tax Revenue at all States-level (as compared with Revised Estimates) are quite marked. The revenue deficit was contained at 0.4 per cent of GSDP (2.44 per cent in the case of Kerala) largely through slashing of expenditure.

Own tax revenue
Barring Karnataka, the actual Own Tax Revenue receipts of every State has been below the revised estimate, points out Mohan.

Also noteworthy is that the ratios of high- and middle-income States such as Maharashtra, Punjab, Andhra Pradesh, Kerala, Tamil Nadu and West Bengal have been below that of all-States average.

But low-income States such as Bihar, Madhya Pradesh and Odisha have shown a higher ratio, indicating a better tax effort.

On the expenditure side, the cuts have been sharper for low-income States and the actual figures have been almost near revised estimates for Kerala.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Desktop Application Development Outsourcing Desktop Application Development Offshore Desk

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions